Kevin McCarthy: Allow Export-Import Bank to close

New House Majority Leader Kevin McCarthy said on Sunday he favors closing down the U.S. Export-Import Bank when its charter expires in September because the government does not need to be involved in financing exports.

“I think Ex-Im Bank is … something government does not have to be involved in. The private sector can do it,” McCarthy (R-Calif.) said in an interview on Fox News Sunday.

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“One of the biggest problems with government is they go and take hard-earned money so others do things that the private sector can do. That’s what the Ex-Im Bank does,” McCarthy said.

The newly elected majority leader’s comments are the latest sign that the Depression-era Ex-Im Bank could be headed for extinction when its current charter expires on Sept. 30.

A number of conservative Republicans oppose renewing the bank, which they view as a form of “crony capitalism.” They were unsuccessful in 2012 in shutting it down, but hope for success this time around.

Defenders say the bank operates at a profit, and is a vital tool for helping U.S. exporters compete against countries like China that have much bigger export credit agencies.

Mainstream business groups, such as the U.S. Chamber of Commerce and National Association of Manufacturers, have launched a big push to persuade Congress to renew the bank. However, their efforts have apparently failed on McCarthy

“Yes, because it’s something the private sector can be able to do,” replied McCarthy, reversing the position he held in 2012, when he voted to renew the bank’s charter and raise its lending cap to $140 billion.

The National Association of Manufacturers likes McCarthy's old position better.

“The reality is that manufacturers of all sizes can’t afford to be defenseless in today’s global marketplace. Allowing the Ex-Im Bank to close would be a gift to our competitors and would result in the loss of manufacturing in the United States," said Linda Dempsey, NAM's vice president of international economic affairs, Sunday. "If Congress fails to take up a reauthorization bill, people are going to lose their jobs, businesses and supply chains around the country will be impacted, and constituents are going to want to know why.”

The Ex-Im Bank, which is celebrating its 80th anniversary this year, provides direct loans, loan guarantees and other forms of financing to help companies like Boeing, Caterpillar and GE export products around the world. It also helps many small and medium-sized companies sell their goods in global markets.

The House Financial Services Committee is holding a hearing on Wednesday to discuss the future of the bank, calling the event, “Examining Reauthorization of the Export-Import Bank: Corporate Necessity or Corporate Welfare?”

Committee Chairman Jeb Hensarling, a Texas Republican, has also stated unequivocally that he opposes extending the government agency’s charter.